Salary Benchmarking Report
CEO Salary Survey
AME Recruitment
January 2014
Salary Benchmarking
January 2014.
LGA SA
Page 1
Executive Summary
AME Recruitment was retained by LGA SA to collect and collate CEO Salary Data for South Australian Local
Government entities with comparisons to be made with the Not for Profit Sector, Interstate Local Government
entities and Selected Public Sector Organisations. The intention is for this report to be updated and reissued
every 6 months (late July and January each year) in order to capture changes in the salary packages and
conditions under which LG CEOs are employed.
This report updates the report released in July 2013.
Data Collection
AME undertook extensive data collection and verification in order to produce an accurate set of results against
which informed comment and analysis could take place. Specifically we sought information from:
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South Australia’s 68 Local Government Councils;
Equivalent Local Government Councils from Western Australia, Victoria and Broken Hill;
Equivalent roles within the South Australian Public Service;
Relevant South Australian not-for-profit organisations.
Information was asked for from all 68 Councils. Where a response was not received data used is from the July
2013 report. 6 councils did not respond.
The data requested was:
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Salary package, including all additional benefits both cash and non cash;
Information relating to the terms and conditions of the CEOs contract including the length of the
contract length, scheduled performance review dates.
Number of Elected Members;
Total staff FTE’s;
Council budget, operational and capital;
Key financial sustainability ratios.
The appendices include information for every SA Council.
Data Analysis
The CEO Salary Survey data was collated and reviewed for validity. The data was then segmented to enable
comparison within segmented groups, between segmented groups, and between South Australian Local
Government entities and Interstate Local Government entities.
Due to a reluctance by several respondents to disclose additional benefits (such as additional leave) and a
general consensus amongst CEOs that additional annual leave (taken in the year it is awarded) has no
commercial value, the salary data reported in this report does not assign a dollar value to additional leave or
other non cash benefits. For consistency of comparison the July 2013 data has been restated omitting values for
items such as additional leave, Council supplied housing etc. This report now simply identifies the presence of
these benefits (where disclosed by CEOs).
Salary Benchmarking
January 2014.
LGA SA
Page 2
Data Segmentation
Grouping of Councils have been made using the following measures:
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Council size, scale and location, using classifications such as G6 + ACC, Other Metro, Outer Metro and
Regional and Small Regional.
Revenue, being annual budget including Operating and / or Capital Budget, or simply Total Budget.
Number of employees.
Asset Base.
Key Financial Sustainability Ratios.
Elected Member Groupings as determined by the Remuneration Tribunal
Key Data
Contained within the attached tables are the results and averages for all South Australian Local Government
Councils split and presented in various ways. Key numbers are highlighted below:
1. The average Total Salary Package in January 2014 (comprised of base salary, super and motor vehicle)
for the CEO of all 68 Councils is $202,256 (vs. $196,041 in July 2013), an increase of 3.17% in the past 6
months.
Measure
January 2014
Total Base
Salary, Super
and Vehicle
July 2013
Total Base
Salary, Super
and Vehicle
Average CEO
Salary
$202,256
$196,041
$202,256 is made up of base salary, super and motor vehicle. (See Table 1 for details)
2. The average annual salary package (comprised of base salary, super and motor vehicle) for the CEO of
all 68 Councils split into common groupings (based on size, locations and Council scale) is:
January 2014
Total Base
Salary, Super
and Vehicle
July 2013
Total Base Salary,
Super and
Vehicle
G6 + ACC
$302,742
$295,169
Other Metro
$247,129
$239,698
Outer Metro
$217,867
$217,549
Regional
$194,007
$188,008
Small Regional
$149,397
$143,022
Average CEO
Salary
Salary Benchmarking
January 2014.
LGA SA
(See Table 2 for details)
Page 3
3. The average annual salary (comprised of base salary, super and motor vehicle) for the CEOs of all 68
Councils split into groups as per Elected Members Remuneration Tribunal Classification (i.e. Group 1,
etc)
Average CEO
Salary
July 2013
January 2014
Total Base Salary,
Total Base Salary,
Super and
Super and Vehicle
Vehicle
Group 1
$293,550
$286,982
Group 2
$232,090
$225,135
Group 3
$207,115
$201,474
Group 4
$175,524
$169,976
Group 5
$149,397
$143,022
(See table 3 for details)
Notes on Other Benefits
The salary package numbers reported throughout this report are the summation of Base Salary, Superannuation
and contractual value of Motor Vehicle supplied to the CEO. These numbers will be consistent with the Salaries
Register maintained by Councils and available for public review.
The following additional benefits have been excluded due to the subjective nature of their valuation:
Additional Annual Leave
Special Leave
Performance Bonuses
Council supplied housing
Other Allowances
Private phone calls (mobile and land line)
Subscriptions
Professional Memberships
A vast majority of “Other Benefits” is made up of additional annual leave (at least 15 instances have been
reported) which ranges from 1 to 2 weeks.
The existence of these benefits, where disclosed, has been outlined in Table 4.
Salary Benchmarking
January 2014.
LGA SA
Page 4
Notes on Calculations
The following notes should be read in conjunction with the tables produced.
Superannuation is 9.25% unless the CEO is in the Defined Benefit scheme where it is currently 9.55%. Few CEOs
have negotiated additional superannuation contributions in lieu of salary – all these factors are reflected in the
Total Salary Package calculation.
The value of motor vehicles is as advised by individual Councils and is between $7,000 and $15,000 with one
outlier at $36,000.
Additional benefits such as additional salary benefits, additional annual leave and rent assistance have not been
assigned a commercial value. A number of CEO respondents have presented an argument that additional leave
(taken in the year of allocation) does not have a commercial value nor a financial cost to the Council. With this
argument in mind, several CEOs have elected not to disclose additional annual leave. To ensure equity and
accuracy, base salary, superannuation and motor vehicle components of the CEOs salary package have only
been included.
Average Increase in Salaries
South Australian Local Government Councils
As reported in the July 2013, the average increase for CEOs in the Local Government Sector has been 3.15% per
annum for the period from July 2009 to July 2013.
In the period July 2013 to January 2014, the average increase across all Local Government CEO Salaries was
3.17%.
South Australian Public Service
The average increase for CEOs in the Public Sector has been 3.0% per annum. Salary increases for Public Sector
CEOs have been constrained in line with general salary constraints placed upon the Public Sector by
Government.
State Government Business Entities
A cross section of CEOs from State Government Business Entities sector (i.e. directly owned or substantially
funded by State Government) shows an increase of 11.01% per annum between 2012 and 2013. This increase is
being driven largely by the appointment of a new CEO in SGBE# 4 at a salary package significantly higher than
the previous incumbent.
Setting this entity aside, the average per annum salary increase for this sample would be 6.84% between 2012
and 2013.
Salary Benchmarking
January 2014.
LGA SA
Page 5
Not for Profit Sector
A cross section of salaries of CEOs from the Not for Profit Sector are outlined below.
Generally salary increases in this sector mirror that of the Private Sector as major Not For Profits seek to attract
and retain skilled corporate leaders. This is further reinforced by the presence of Corporate Leaders occupying
key decision making Board positions. It is for this reason that the average salary increase across this sector has
been around 4% per annum for the past 3 – 4 years.
National Average Private Sector
The average increase for CEOs on a national basis has been between 4% and 5% per annum with general
constraint being common place in many companies for the past 3 to 4 years driven primarily by subdued
economic climate.
South Australian Average Private Sector
The average increase for CEOs in the private sector in South Australia has been 3.5% and 4% per annum with
general constraint being common place in many companies for the past 3 to 4 years driven primarily by subdued
economic climate.
The Role of CEO
The CEO is the highest ranking officer within an organisation and is responsible for the total management of an
organisation. Whilst the business they are leading may vary their broad responsibilities cover:
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Leadership
Financial Management
Strategic Planning
Governance
Stakeholder Management
Hence the salaries of CEOs within different sectors are able to be compared.
It should be noted, however, that in comparison to CEOs in other sectors, those in Local Government are
employed by Council and so report to the whole Council.
Councils business requires these Executives and their Senior Management Team to attend Council meetings and
Workshops which are usually held after hours. The number of nights per month is dependent the number of
meetings held. These meetings have no time limit.
Chief Executives within Local Government are also expected to attend community functions which again are
often after hours and on weekends. There is generally no time in lieu for this time commitment and is an
expectation of the role of the Chief Executive.
Salary Benchmarking
January 2014.
LGA SA
Page 6
Interstate data
Below are a sample of Councils from Western Australia and Victoria (selected as these States border SA).
Salary Packages are similar in size and composition to those available in South Australia.
Western Australia
CEO Salary Package
Vehicle
Total Cash,
Super and Car
$17,571
N/A
$212,800
$174,476
$15,703
$15,000
$205,179
$67,715,000
$249,000
$22,410
$15,000
$286,410
610
$166,000,000
$300,032
$27,003
$15,000
$342,035
South Perth
268
$46,375,000
$217,799
$32,670
$10,000
$260,469
Victoria Park
185
$47,914,000
$206,002
$35,020
$10,000
$251,022
$223,756
$25,063
$13,000
$259,653
Council
Staff Numbers
Budget
Salary
Super
Albany
379
$43,322,000
$195,229
Broome
175
$29,958,000
KalgoorlieBoulder
410
Perth
Average
Victoria
CEO Salary Package
Council
Staff Numbers
Budget
Salary
Super
Vehicle
Total Cash
Super and Car
Glenelg Shire Vic
236
$59,000,000
$218,780
$20,482
$8,800
$248,063
240
$13,975,000
$193,097
$17,379
$10,000
$220,476
384
$76,915,000
$224,770
$20,230
$10,000
$255,000
377
$39,198,000
$187,203
$16,848
$10,000
$214,051
$205,963
$18,735
$9,700
$234,398
Broken Hill
Council
Warrnambool
City Council
Southern
Grampians Shire
Council
Average
Salary Benchmarking
January 2014.
LGA SA
Page 7
State Government Business Entities
Below is a cross section of CEOs from State Government Business Entities sector (i.e. directly owned or
substantially funded by State Government). Salary packages range in size in a similar way as salaries do in the
Local Government Sector.
Salaries have increased for the 4 SGBE’s listed below by 11.01% between 2012 and 2013, driven primarily by the
appointment of a new CEO for SGBE 4 at a significantly higher rate than the previous incumbent. If SGBE # 4 is
excluded from the calculation, the average increase between 2012 and 2013 is 6.84%.
2013 Salaries / Wages
2012
SGB Entities
Budget
Head
Count
Salary
Super
Vehicle
Total Package
Salary
Package
Growth
SGBE # 1
$48,500,000
200
$253,000.00
$24,200.00
$19,000.00
$296,200.00
$290,700.00
1.89%
SGBE # 2
$18,844,000
110
$211,009.00
$18,991.00
$230,000.00
$210,000.00
9.52%
SGBE # 3
$8,258,000
50
$172,700.00
$15,543.00
$188,243.00
$168,000.00
12.05%
SGBE # 4
$4,600,000
15
$136,500.00
$13,500.00
$150,000.00
$110,000.00
36.36%
Average
$216,110.75
$194,675.00
Average
Increase
11.01%
Salary Benchmarking
January 2014.
LGA SA
Large increase driven by
change in CEO @ SGBE #4
Page 8
Not For Profit Sector
A cross section of CEOs from the Not for Profit sector is shown below.
Generally salary increases in this sector mirror that of the Private Sector as major Not For Profits seek to attract
and retain skilled corporate leaders. This is further reinforced by the presence of Corporate Leaders occupying
key decision making board positions. It is for this reason that the average salary increase across this sector has
been around 4% per annum for the past 3 – 4 years.
2013 Salaries / Wages
Motor Vehicle
Notional Value
NFP Entities
Budget/Income
Head Counts
Salary
Superannuation
NFP # 1
$3,300,000
13
$128,054.92
$11,845.08
NFP # 2
$17,800,000
573
$256,820.00
$25,000.00
NFP # 3
$18,950,000
145
$256,292.91
$23,707.09
NFP # 4
$48,300,000
200
$277,200.00
$25,641.00
$19,000.00
$321,841.00
NFP # 5
$53,000,000
1100
$251,716.25
$23,283.75
$12,000.00
$287,000.00
NFP # 6
$105,000,000
1500
$251,716.25
$23,283.75
$236,966.72
$22,126.78
Average
Total Package
$139,900.00
$25,000.00
$306,820.00
$280,000.00
$275,000.00
$18,666.67
$268,426.83
Yours sincerely,
AME Recruitment Pty Ltd
Adam Kennedy
Senior Consultant
Phone: (08) 8228 3800
Email: a.kennedy@amerecruitment.com.au
Salary Benchmarking
January 2014.
Allison Ashby
Director
Phone: (08) 8228 3800
Email: a.ashby@amerecruitment.com.au
LGA SA
Page 9